covered here - FY15 eps guidance looks ok - very nice gain despite being WRONG initially
shorted 5k shares in anticipation of the usual gameplay
nothing to get excited about here
Marcum is a tiny company with just around 75 professionals located in China. Their US exchange listed Chinese clients are mainly small and sometimes shady companies listed on the OTC or Pink Sheets.
As an example Marcum was appointed as the new auditor for Ambow Education in April 2013 following the resignation of PwC (does this sound familiar ?). Despite Ambow being a MUCH smaller company then NQ Mobile it took them 15 months to file their overdue 20-F last week.
Given the low staff level at Marcum and the complexity of the issues at NQ it is hard to see how they will be able to finish the audit in time for the convert deadline
bad work - remember the units consist of one share and just 0.5 warrants...while it was easy to make money here by shorting the shares into the expected offering the easy money on the short side has now been made. At least until their business starts to deterioate again or the market bubble bursts with a bang. This was at $2.50 (my short entry) shortly after earnings and outlook. It might have a few more shaky days after the offering but I firmly expect the shares to move up to $2 (at least) within a few weeks. I covered my short on Friday and went long 150k shares. So let's see what happens.
that's how things go - if investors would have to pay as much as on the stock exchange there would be no argument to buy the offering. I certainly prefer an equity offfering over costly bank debt.
no - as evidenced today with the improving business trends the company has no problems to access the capital markets while AVNW clearly won't be able to raise money currently. AVNW has underperformed their own cash flow projections by a wide amount in the recent past and things have only gotten worse so far.
sure - but they have projected improvements in the past just to come in even worse than before. Last quarter was by far the most painful the company has reported within the last few years. Until they report sustained improvement shares shouldn't be touched. Another few poor quarters and they will be on the verge of bankruptcy.
once the pricing is announced the deal is agreed upon - this is basic knowledge by the way.
And clearly it should come as no surprise that the share price doesn't mirror the offering price as the stock has to price in the percentage of DILUTION caused by the offering. Given the fact that there were additional warrants attached to the shares the stock the potential dilutive impact of the offering is more than 30% so clearly today's mild discount shows that the offering is generally well received from investors.
unlike DRWI the business of AVNW still has not bottomed out yet and the company has burned a significant percentage of their once rock solid cash balance and is projected to burn even more going forward. Coupled with main customers located in unstable third world countries the business looks far more risky than DRWI.
which should bode well for the share price going forward. Now that the much needed secondary is out of the way investors will focus on the improving business of the company (though I doubt the recent improvement will be sustainable).
I am in for a short term trade here. Will buy more if the stock weakens further.
that's not what they said on the call - actually they are looking to get into the sales process even earlier so clearly they require MORE people as evidenced by many analyst questions around this topic on the call. Their business model is on the verge of failing here and they are freezing investments.
at least three downgrades this morning are pretty telling about what management had to offer in yesterday's conference call. The shares are down already 30% this morning and might drop into the $5 area this afternoon only to be dead money for at least the rest of the year. Sell.
the CEO announced on the call that the company will essentially stop investment in new hires and marketing initiatives going forward to "consolidate" previous investments. Given this ill-fated move I would view guidance not as overly cautious rather than still optimistic. Frankly I don't see how the company will return to previous growth rates without ongoing investment in the salesforce and their product development.
actually the company guided down for Q3 on the conference call and I would suspect several analysts to downgrade their ratings on the stock tomorrow.
actually I see plenty of downside as management's "actions" to right the ship most likely will make things even worse. Given the issues at the company level I can't imagine any kind of m&a activity as long as the business remains a trainwreck. Sell.
I don't think buyers will line up given the dismal state of company. Guidance for Q3 is for FLAT revenues and margins. Company will stop hiring and investing in new initiatives for the time being which clearly won't lead to renewed revenue growth.